The International Financial Reporting Standards will strengthen access to finance and investment, boost global competitiveness and reduce the risks of financial misreporting.
Taskeen Ahmed, president of Dhaka Chamber of Commerce and Industry, said this at a focus group discussion on 鈥業mplementation of IFRS for SMEs鈥� held at DCCI in the capital on Saturday.
He said SMEs are the lifeline of Bangladesh鈥檚 economy contributing over 25 percent to the GDP. He also said the adoption of 鈥業nternational Financial Reporting Standard鈥� (IFRS) for SMEs provides a structured framework that enhances financial transparency, said a press release.
The DCCI president said IFRS would significantly impact tax revenue collection by improving compliance, minimizing tax evasion and bringing more businesses into the tax net.
He also termed that limited financial capacity, shortages of skilled manpower and compliance cost creates barriers in adopting IFRS for SMEs. Taskeen stressed on the need for more investment in training and regulatory alignments.
Mohammad Abu Yusuf, chairman (Acting) of Financial Reporting Council, said IFRS is very important for SMEs to comply with the international standards, but its implementation is still challenging for the SMEs due to lack of knowledge, skilled workforce, easy procedures and awareness.
There is no alternative to enhancing the capacity of SMEs to make them interested in implementing IFRS, he opined. 鈥楽MEs need to be more focused on IFRS implementation to increase tax compliance, access to capital from the capital market, and signing international trade agreements,鈥� Yusuf added.
Md Amir Uddin, executive director of Bangladesh Bank (BB), said the implementation of IFRS should be focused on improving the image of local SME entrepreneurs in the global arena, but it is necessary to provide training to improve their skills. They should be well aware of the benefits of implementing IFRS as well, he added.
Nawshad Mustafa, director of SME and Special Programmes Department of Bangladesh Bank, said they have a lack of trained and skilled accounting professionals in the country especially for SMEs.
鈥楾o implement IFRS in a practical manner, an enabling environment is necessary for this,鈥� he said adding that IFRS is implemented in 80 countries in the world and it is also required to implement but that should be without affecting the business activities of the SME sector.
Nawshad again stressed for a friendly environment for its implementation.
Mohammad Jahangir Hossain, general manager of SME Foundation, said from SME Foundation accounting software were provided to few SME entrepreneurs, but it was not implemented in many cases due to lack of skills and interest.
He then proposed sector-based customized accounting software for the SME sector to make it easy. Later, he emphasized on providing facilitation and training for further implementation of IFRS.
Sk Md Tarikul Islam, partner of Hoda Vasi Chowdhury and Co Chartered Accountants, presented the keynote paper. 鈥楥apacity building, training for accountants and auditors and initial transition costs are some of the challenges for implementation of IFRS,鈥� he said.
Regulatory bodies, professional organisations, and financial institutions can play a vital role in facilitating a smooth transition, he added.
He also highlighted key benefits of IFRS for SMEs such as simplified reporting, cost-effective compliance, enhanced credibility and facilitating growth.
Tarikul, however, urged for easy access to finance, lower tax and vat rate, reduced tax rate for green business, tax incentive for SME startups and simplification of tax payment process for the SME sector.
Speaking at the open discussion, DCCI convener Lutful Hadee said there are about 2,200 chartered accountants in the country, out of them about 600 are in practice.
Moreover, about 40,000 part-qualified accounting professionals are also in the market after completing various pertinent courses.
DCCI鈥檚 joint convener Md Shafiqul Alam urged for uniformity in the definition of SME in different policies and regulations of different institutions.
DCCI鈥檚 senior vice-president Razeev H Chowdhury and Vice-president Md. Salem Sulaiman were also present at the meeting.
